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Home Audit News 02 July 2012

02 July 2012

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SAAPS 2 (Revised) Financial Reporting Frameworks and the Auditor's Report and SAAPS 3 (Revised) Illustrative Report



Johannesburg / 02 July 2012



The IRBA today released the Revised South African Practice Statement (SAAPS) 2 (Revised) Financial Reporting Frameworks and the Auditor's Report and SAAPS 3 (Revised) Illustrative Reports issued, as at 30 June 2012, as non-authoritative guidance that provides practical assistance to auditors for use in South Africa. They provide material that firms can use in developing their training programs and providing internal guidance to their staff.


As non-authoritative guidance in the implementation of the International Engagement Standards, SAAPS 2 (Revised) and SAAPS 3 (Revised) may be implemented immediately on issue and accordingly no longer contain effective dates.


Withdrawal of the existing SAAPS 2 and SAAPS 3

The existing SAAPS 2 and SAAPS 3 are hereby withdrawn, and replaced with immediate effect by the SAAPS 2 (Revised) and SAAPS 3 (Revised) now issued.


SAAPS 2 (Revised)

The changes to SAAPS 2 (Revised) arise from the requirements of the Companies Act, 2008 and Regulations, 2011 pursuant thereto, that became effective from 1 May 2011 and include:

  • Removal of references to the Companies Act, 1973;
  • The establishment of the Financial Reporting Standards Council (FRSC) that advises the Minister of the Department of Trade and Industry on Regulations prescribing recognised general purpose financial reporting frameworks to be applied in South Africa by companies and close corporations;
  • The consequences of the Accounting Practices Board commencement of the voluntary winding up process;
  • The inclusion of an Appendix with the Companies Act, Regulation 27, setting out the financial reporting frameworks to be applied by companies and close corporations; and
  • The withdrawal of SA GAAP as an acceptable financial reporting framework that will cease to apply in respect of financial years commencing on or after 1 December 2012.


SAAPS 3 (Revised)

The changes to SAAPS 3 (Revised) arise from the requirements of the Companies Act, 2008 and Regulations, 2011 pursuant thereto, changes to the reporting standards included in the International Standards on Auditing and the International Standards on Review Engagements and address the public sector reporting requirements of the Auditor General South Africa.


SAAPS 3 (Revised) includes guidance on the format and wording of individual paragraphs in auditors' and independent reviewers' reports and illustrative example reports that:

  • Provide 34 examples of auditors' and independent reviewers' reports with unmodified and modified opinions, and disclaimers of opinions, in different circumstances that may be applied to companies, close corporations and other entities;
  • Clarify that the auditor's / independent reviewer's opinion relates specifically to the audited or reviewed financial statements prepared in accordance with the applicable financial reporting frameworks, in different circumstances;
  • Provide guidance for the auditor's responsibilities and wording of the paragraph in the auditor's report on the "Other reports required by the Companies Act", namely the Directors' Report, Audit Committee's Report and the Company Secretary's Certificate included in the audited or reviewed financial statements of a company or close corporation as required by Section 29 of the Companies Act, 2008 that meets the needs of CIPC;
  • Provide Afrikaans translations for illustrative report examples; and
  • Provides illustrative wording for selected Notes xx to the financial statements.

We hope that auditors will find the illustrative reports useful and they will enhance the quality of reports issued.


SAAPS 2 (Revised) is available in a PDF format and SAAPS 3 (Revised) is available in both PDF and Word formats, and may be downloaded from the IRBA website.


Should you have any further queries or experience any technical difficulties in downloading the documents please do not hesitate to contact the Standards Department at +27 (0)87 940 8800 or send an email to This e-mail address is being protected from spambots. You need JavaScript enabled to view it .


Download this communiqué in (Doc | PDF) format.


Sandy van Esch
Director: Standards


About the IRBA
The objective of the IRBA is to endeavour to protect the financial interests of the South African public and international investors in South Africa through the effective and appropriate regulation of audits conducted by registered auditors, in accordance with internationally recognised standards and processes.
The CFAS assists the IRBA to develop and maintain auditing pronouncements which are internationally comparable.

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